Increasing government borrowing to invest in infrastructure may reduce a country’s debt burden in future because interest rates are expected to stay low for many years to come, a study by the International Monetary Fund has claimed.

In future years, real interest rates — the cost of borrowing minus inflation — are likely to rise more slowly than GDP, as the savings glut from emerging markets persists and financial regulation forces banks to hold more safe assets, such as government bonds.

As long as the economy is growing faster than its debt servicing costs, borrowing more may actually improve a country’s public